Letters: Martinez And Film Tax Incentives

Sean Cardinalli
3 min read
(Robert Maestas)
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Dear Alibi,

Governor Susana Martinez’s office recently put out a
press release touting local film and television production’s steep revenue increase (PDF) to almost $290M in fiscal year 2015. Local production generated $118.7M in 2011 but crashed to less than $83M last year. But NM film office director Nick Maniatis’s release was grossly disingenuous by glossing over the fact that the governor herself was responsible for the revenue downturn. After hobbling the industry by rolling back its gains under former Governor Richardson, then slowly tweaking that rollback, Martinez has gall taking credit for the “upturn.”

There wouldn’t have been a stall-out in the first place had Martinez not played politics and nearly killed the once-thriving and community-building industry. In the early 2000s, New Mexico was at the vanguard of states enacting a film/TV tax incentive program. In the program, a production entity reported qualifying expenditures and received a 25% “refundable tax credit” after production completed. Under Martinez’s predecessor, Gov. Richardson, the Land of Enchantment’s movie and TV production slate exploded right up until Martinez took office. The success of movies from
No Country for Old Men to The Avengers and amazing TV like “Breaking Bad” proved to the entertainment world that New Mexico was a production force to be reckoned with. The otherwise lethargic state economy was bolstered tremendously and a community-based sense of pride grew accordingly.

All that changed when Martinez took office. In 2011, she called the rebate program “
a giveaway the state can no longer afford” and dismissed it as a “subsidy to Hollywood” while waging no such trash-talk against similar oil/gas or potash tax programs. Martinez capped the program at $50M per annum in rebates, meaning one or two big productions might reap the benefits of the scaled-back program, but others would be left bereft.

In March 2013, something changed and Martinez flipped the script, perhaps seeing the disastrous economic effects of her decision the prior two years. She shocked Santa Fe politicos and industry professionals alike by
about-facing on her threat to veto the “Breaking Bad” law which specifically incentivized TV production in the wake of that show’s historical success, offering a 30% break under certain circumstances. She subsequently allowed for a $10M “rollover” to the $50M annual cap. Some industry professionals still groaned that, even in 2009 the state was rebating well over $80M annually. Almost $36M was lost during Martinez’s early tenure, with morale amongst production folk similarly waning. The tight-knit community here watched states like Georgia, Louisiana and South Carolina explode in production revenue, using models largely based on New Mexico’s original one. The Avengers even decided not to return for their sequel.

Come August of last year,
Variety, a leading film industry daily trade mag, did a kitten gloves interview with Martinez, failing to connect the dots to her complicity in the downturn and Maniatis’s most recent press continues that hagiographic tendency. Whether or not she has truly seen the light, Gov. Martinez lost our already-struggling state a lot of money, money that might’ve been a thicker cushion to fall on amidst the global recession. Since 2010, 17,000 production jobs were created here; how many more might have been generated without the rollbacks? Over $500M was generated by the industry for the state economy from 2010 to 2014; and a state struggling as much as New Mexico can’t afford any less due to political guile.

Letters should be sent with the writer’s name, address and daytime phone number via email to letters@alibi.com. They can also be faxed to (505) 256-9651. Letters may be edited for length and clarity, and may be published in any medium; we regret that owing to the volume of correspondence we cannot reply to every letter. Word count limit for letters is 300 words.

Martinez and the “upturn”

Robert Maestas

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